In plain language
A signal provider is a person or system that creates and distributes instructions such as instrument, direction, entry, exit, or risk updates.
Manual signal or automation
If the user must confirm each trade, the signal remains information to assess. If it is converted into orders without another user action, it enters auto-trading or copy-trading territory. The exact roles and regulatory treatment depend on the service and jurisdiction.
It is not one fixed role
The provider is not necessarily the broker, custodian, manager, or execution venue. A delivered signal does not prove that an order was accepted or filled. Whether a service is paid, free, or anonymous does not alone establish reliability or fraud.
Minimum due diligence
Check identity, registration where required, method, timestamps, a complete rather than selected history, costs, conflicts, drawdown, and how access is revoked. Guaranteed-return claims, requests for account credentials, and unsupported results are warning signs. The Anti-scam path provides the complete checks.
Sources
- FCA, Copy trading — Distinguishes user-confirmed signals from the automatic conversion of signals into orders.
- FINRA, Know the Risks of Auto-Trading Services Offered by Unregistered Entities — Provides checks for providers, registration, performance, data, and account access.
- U.S. SEC, All About Auto-Trading — Explains the risk when a third party can send instructions directly to a broker without prior confirmation.